Nissan to cut costs by US$2.8 billion, remove Datsun

According to report by Bloomberg, Nissan is looking to reduce its annual fixed costs and book restructuring charges by 300 billion yen (around US$2.8 billion or RM12.2 billion) to cope with the Covid-19 pandemic that has left a significant impact on sales.

An unnamed insider told the publication that these initiatives are part of a three-year plan that the company will reveal on May 28 together with the carmaker’s latest financial results. Other measures planned include phasing out the Datsun brand, which has already exited Indonesia, as well as a reduction in spending by trimming marketing, research and other costs.

Additionally, the company will shut down another production line, bringing the worldwide total to 13. This is to increase its utilisation ratio to approximately 80% within three years from 65% in the previous 2019 fiscal year ending March 31, 2020, with a reduced annual production capacity of 5.4 million vehicles.

“Nissan will announce a revised midterm plan along with fiscal year 2019 financial results on May 28. We do not have any further comments on this subject,” said Azusa Momose, a spokeswoman for Nissan.

Previously, it was reported that Nissan will focus more on the United States, China and Japan markets, while its Alliance member Renault will cater to Europe. Meanwhile, Mitsubishi will focus on markets in Asia where it has a bigger presence.

It hasn’t been an easy time for Nissan, as the carmaker has had to cope with the scandal involving Carlos Ghosn and the multiple managementchanges made after his departure. Further spurring the need for a restructuring is the current global health crisis that has resulted in plant closures and less than encouraging sales performance.

Originating from the corporate world with a background in finance and economics, Gerard’s strong love for cars led him to take the plunge into the automotive media industry. It was only then did he realise that there are more things to a car than just horsepower count.

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